Opinion Of Eminent Legal Luminaries On Controversial Issues

Capital gains – Full value of consideration – Stamp valuation -Applicability of S. 50C to agricultural land

QUERY: An agriculturist sold his agriculture land to an infrastructure company for the commercial project after obtaining permission from the Collector under section 63 of the Bombay Agriculture & Tenancy Act. The sale deed was executed for agriculture land as per jantri value mentioning order number of Collector. One of the conditions of the order was that the stamp duty would be payable as per N.A land. Now the assessee has executed sale deed for agriculture land as per jantri value. The Assessing Officer has passed the order making addition of difference value of Rs. 90/- lakh as per non agriculture under section 50(C); though the assessee has executed sale deed for agriculture land. Whether action of Assessing Officer is right?
ANSWER: Section 50C reads as under:
"Where the consideration received or accruing as a result of the transfer by an assessee of a capital asset, being land or building or both, is less than the value adopted or assessed or assessable by any authority of a State Government (hereinafter in this section referred to as the "stamp valuation authority") for the purpose of payment of stamp duty in respect of such transfer, the value so adopted or assessed or assessable shall for the purpose of section 48 be deemed to be the value of the consideration received or accruing as a result of such transfer".
Thus reading above, it is clear that this section is applicable to all kinds of land, whether agricultural [other than land situated in area stated in clause (iii) of section 2(14)] or non- agricultural. Therefore, action of the Assessing Officer is right in making addition of difference in value of land as per stamp duty value over Jantri value.
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